More Trouble for PNB! Bank Unions Oppose PNB’s Implementation of Revised PLI Scheme; Write Letter to IBA and Labour Commissioner
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The controversy of PLI is not over yet. Now, Punjab National Bank has come into the limelight. Recently, PNB had credited PLI to officers up to Scale III. The employees and management seemed to be happy but soon the controversy started. But Why? The controversy started because PNB had paid PLI to officers up to Scale III only and not to officers above Scale III.
The IBA had advised Banks not to credit PLI to employees as the discussions are still going on. Recently, The Government of India had introduced new PLI guidelines for employees of Public Sector Banks. But, the employees were not happy with the new PLI policy. So, the Bank Unions asked Government to revise PLI norms. The IBA instructed banks to put PLI on hold.
But, the PNB credited the PLI and controversy started. Now the United Forum of Bank Unions (UFBU) has raised strong objections to the implementation of revised Performance Linked Incentive (PLI) scheme by Punjab National Bank (PNB). The unions have written to the Indian Banks’ Association (IBA) and the Chief Labour Commissioner (CLC), calling the move a violation of settlement terms and an ongoing conciliation process.
What Is the Issue?
The PLI scheme is a part of the agreed service conditions for all bank employees and officers—from part-time staff up to Scale VII officers. This scheme was introduced through a bipartite settlement and a joint note signed by unions and bank management.
However, in November 2024, the Government introduced a revised PLI scheme specifically for Whole Time Directors and officers in Scale IV and above. According to the UFBU, this new scheme:
- Violates the original agreement between bank unions and management.
- Is discriminatory and unfair, as it provides different terms for senior officers.
- Was not discussed or approved with employee organizations.
New PLI Scheme in Controversy
Earlier, the Banks had released a new PLI scheme for Officers in Scale IV and above. Scale IV Officers were to be given PLI up to 70% of their Annual Basic Pay.
- Scale IV officers can get 70% of their annual basic pay (approximately ₹11.75 lakh per year).
- Scale V and VI officers can get 80% of their annual basic pay (approximately ₹14.40 lakh per year).
- Scale VII officers can get 90% of their annual basic pay (approximately ₹22.50 lakh per year).
- EDs and MDs of Nationalised Banks, DMDs, MDs, and Chairman of SBI can get PLI up to 100% of their annual basic pay
| Grade | PLI Ceiling as % of Annual Basic Pay |
|---|---|
| EDs and MDs of Nationalised Banks, DMDs, MDs, and Chairman of SBI | 100% |
| Scale VII and Scale VIII | 90% |
| Scale V and Scale VI | 80% |
| Scale IV | 70% |
Discussions related to PLI are undergoing between UFBU and IBA in the office of the Chief Labour Commissioner. The United Forum of Bank Unions (UFBU) had asked IBA to advise all Banks to defer payment of PLI to employees until discussions are ongoing. Conciliation meetings were held at the Chief Labour Commissioner’s (CLC) office in Delhi on March 18 and 21, 2025. During these meetings, it was agreed that the Indian Banks’ Association (IBA) would collect feedback from member banks and submit a review to the Department of Financial Services (DFS). [Read: UFBU asks Banks to Postpone New PLI Scheme for Senior Officials]
Unions Had Raised Concerns Earlier
This issue had already been raised by UFBU during a strike notice and was part of ongoing conciliation discussions with the Chief Labour Commissioner (CLC). In fact, a conciliation meeting on the issue is scheduled for June 16, 2025.
In the meantime, the IBA had informed unions that the matter was referred to the Department of Financial Services (DFS) for further guidance. Unions had expected that until a final decision was taken, no bank would implement the new scheme.
PNB’s Unilateral Move Sparks Protest
Despite this, Punjab National Bank (PNB) has gone ahead and credited the PLI amount to employees and officers up to Scale III, based on the revised scheme, without consulting the unions or considering the ongoing dispute.
UFBU has termed this move:
- Unfair
- Provocative
- A violation of ongoing conciliation proceedings
The unions believe that PNB’s action could prejudice the outcome of the dispute and disrupt industrial harmony.
Appeal for Immediate Intervention
In their joint letter, the nine UFBU constituents—AIBEA, AIBOC, NCBE, AIBOA, BEFI, INBOC, INBEF, NOBW, and NOBO—have:
- Urged the IBA and CLC to intervene immediately.
- Requested that banks be directed to put on hold the revised PLI scheme until the dispute is resolved.
- Warned that if the issue is not addressed urgently, the unions may be forced to take further action.
What’s Next?
The next round of conciliation talks is set for June 16, 2025. The unions expect the matter to be resolved in that meeting and hope that the Government and bank managements will respect the collective bargaining process and avoid unilateral decisions.
Until then, the UFBU has asked its members to stay alert but patient, while the leadership handles the matter through official channels.
